Philippine casino firm Travellers disappoints in market debut


* Shares finish 0.2 pct below IPO price

* Some investors not keen on gaming issues, tax issue weighs

* Travellers' valuations higher than rival Bloomberry

* Outlook for Robinsons listing on Monday unclear (Recasts with weak finish, adds background on tax issues)

By Rosemarie Francisco and Erik dela Cruz

MANILA, Nov 5 (Reuters) - Philippine casino operatorTravellers International Hotel Group Inc ended belowits IPO price in its market debut, hurt by the reluctance ofsome investors to pick up gaming stocks and unresolved taxissues for the sector.

Some market participants also blamed a cooling in investorsentiment towards emerging markets amid fears that the U.S.Federal Reserve will begin tapering its bond-buying stimulusprogramme sooner rather than later.

That could bode ill for next Monday's listing of departmentstore and supermarket operator Robinsons Retail Holdings Inc, which raised $650 million in the country's largestever initial public offering.

Although Philippine companies have raised a record $1.35billion from IPOs this year, both Travellers, which raised $470million, and Robinsons saw their IPO fund raising scaled backdrastically from initial hopes on cooler sentiment towardsemerging economies.

Travellers' shares closed at 11.26 pesos, 0.2 percent lowerthan its IPO price of 11.28 pesos. The broader market declined0.4 percent.


Analysts and fund managers noted, however, that Travellers'debut was hamstrung by factors specific to the company.

"It being a gaming name, we also have a lot of clients whoare mandated not to invest in such names," said Vittorio Gomez,vice president and fund manager at Rizal Commercial BankingCorp. "I don't think you can use the performance of Travellersas a benchmark for the performance of Robinsons."

In addition, the casino sector has suffered after thenation's tax bureau in April said it wanted gaming companies topay income tax. The firms have until now only paid a 5 percentfranchise tax on gross gaming revenues.

Travellers valuations are also relatively high, with its forward price to earnings ratio estimated at 21.5 times, higherthan local rival Bloomberry Resorts Corp's 17 times.

"The valuation was not compelling, not exciting enough tomerit strong demand on its first day," said Jose Mari Lacson,research head at Campos, Lanuza & Company Inc.

Travellers, a venture between casino operator Genting HongKong Ltd and Philippine conglomerate Alliance GlobalGroup Inc, will use the IPO proceeds to expand ResortsWorld Manila, the first integrated casino-entertainment complexin Manila. It will add a convention centre, 1,100 hotel roomsand more gaming facilities.

Manila is seeking to position itself as an alternative toestablished gaming centres in Asia such as Macau.

A 100-hectare Entertainment City gaming complex housesBloomberry's Solaire casino-resort and will be home to a MelcoCrown Philippines Resorts Corp next year.

Travellers also aims to start construction of a secondcasino-resort in the Entertainment City complex next year, to becompleted by 2017 at the earliest.

In addition to Robinsons, three other Philippine firms willlist this year. Resort hotel owner Discovery World Corp,appliance maker Concepcion Industrial Corp and Frontier Oil Corp aim to raise a combined $130 million from their IPOs.

Bank of America Merrill Lynch, CIMB, Maybank, Religare and UBS were joint globalcoordinators, international bookrunners and international leadmanagers for the Travellers' offer. (Editing by Edwina Gibbs)

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